The reforms SA business owners need

Alan Read

SA Corporate Agriculture Director, ANZ

As South Australia’s economy continues to pick up pace, one of the state’s business owners is eager to see its acceleration continue – and says further tax reforms and a stronger focus on export markets will help.

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Pic: Adelaide Oval, South Australia

Speaking to bluenotes at a budget event in Adelaide hosted by ANZ and Grant Thornton, Angove Family Winemakers Director Victoria Angove said her business was upbeat about South Australia’s economic outlook and future opportunities for local wine producers.

"Bravery and leadership in the tax process … would really help get rid of some red tape and reduce some compliance costs.” – Angove

A greater focus from government on export opportunities and tax reform would assist the growth trajectory, she said.

“There has been a lot of tinkering around the edges in our tax system,” Angove said. “I think we’re really lacking leadership in the tax reform discussion. To see some bravery… in that process and [simplifying] what has become a really complex and convoluted tax system would really help get rid of some red tape and reduce compliance costs.”

ANZ Senior Economist Joanne Masters said the outlook for business was solid given South Australia was experiencing above-trend growth and is accelerating, driven by a couple of key sectors.

“If we look at jobs growth in South Australia, over the last year the healthcare sector has been the biggest employer of new jobs,” she said. “What’s quite unique in South Australia is around agriculture so quite strong jobs growth in agriculture and I see that as an opportunity.”

Grant Thornton Tax Partner Yan Wong expects to see an economic boost from the individual and company tax concessions outlined in the budget.

“South Australia contributes about 7 per cent of individual tax payers and the government estimates the overall tax benefit of these cuts will be about $A146 billion over 10 years,” he said. “If we get our 7 per cent chunk of that money you can quite easily see it’s a big amount of money for business and consumers in South Australia.”

Research and development concessions for small businesses with turn over under $A20 million dollars and an asset write-off up to $A20,000 could also create some windfalls for business owners, Wong said, including cash-flow benefits and the ability to invest in technology or equipment with additional subsidies.

Angove said the changes were great news for the wine industry, which she cited as critical to South Australia’s economic health.

“We employ around 9,000 people as an industry let alone the multipliers that come by from tourism and other suppliers of services to the wine industry and we are very optimistic about the state of the international wine opportunity for South Australian wine,” she said.

“Internationally we have a situation where demand is growing beyond supply; it’s never been healthier than it is today.”

Alan Read is South Australia Corporate Agriculture Director at ANZ

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.